A Senate committee rolled back proposed tax increases in a sprawling bill that would change rates on internet sales, car purchases, e-cigarettes and more. House Bill 6 represented a push by top Democrats in the House of Representatives to shore up the state’s finances, which now rest largely on revenue from oil and gas. But it prompted plenty of skepticism for threatening to raise taxes for many New Mexicans at a time when the state enjoys a hefty budget surplus from an energy boom. The big question now is when the bill will get a hearing in its next and last committee as the Legislature hurtles toward a noon Saturday adjournment. If the Senate Finance Committee doesn’t act on the measure until Friday, House Democrats may be left with little time to negotiate and have to choose between either accepting the Senate’s changes or nothing.
The chairman of an influential Senate committee proposes to strip out big pieces of a sprawling tax bill, scrapping a proposed increase in New Mexico’s personal income tax rates and scaling back a suggested increase in a credit for families. For backers of House Bill 6, the measure is key to making the tax system more progressive and shoring up the state’s finances before the oil industry takes another dive and New Mexico’s government is left strapped for cash again. But the idea of passing several tax increases at a time when the state anticipates a budget surplus from an ongoing oil boom has drawn plenty of criticism. Some senators on both sides of the aisle have argued the proposed tax hikes are too much, too fast — and potentially a big political liability. Sen. Clemente Sanchez, a Democrat from Grants who chairs the Senate Corporations and Transportation Committee, on Tuesday called for changes to the bill that would reduce the amount of money raised for the general fund from more than $300 million in the next fiscal year to an estimated $93 million, not including some other changes.
With only days left in the 2019 legislative session, the struggle between the Senate and the House of Representatives over how to reset New Mexico’s minimum wage law continued Tuesday when a House committee clashed with a senator over competing proposals. And while the differences may be minimal to some — an extra dollar an hour in the House bill, a lower minimum wage for high school students in the Senate bill, for example — Sen. Clemente Sanchez, D-Grants, said if the two sides continue to butt heads on the matter, the state’s lowest-paid workers will suffer. “I do not want to get to the point where we cannot work something out and we have no minimum wage [increase],” Sanchez told members of the House Labor, Veterans and Military Affairs Committee. “That’s more of a tragedy than either one of these bills not passing.” But the five members of the committee present for the hearing on Sanchez’s Senate Bill 437 were unmoved, voting 5-0 to attach what he considered an “unfriendly amendment” to his bill and thus putting it more in alignment with a House bill working its way through the Senate side.
Democrats are backing off a proposal to phase out the lower minimum wage for tipped workers like restaurant waiters with a Senate committee voting Saturday to keep the separate rate in place but raise it. House Bill 31 would have eliminated the tipped minimum wage of $2.13 an hour. Employers can currently pay that rate to workers as long as those workers receive tips amounting to the statewide minimum wage of $7.50 an hour. The restaurant industry says the tipped minimum wage is key to its survival and has launched an intense lobbying campaign against proposals to abolish it. But others argue that raising or eliminating the lower tipped wage would amount to a significant boost in the base pay for many restaurant workers.
A wide-ranging tax bill that passed the House of Representatives in a unanimous vote ran into obstacles at a Senate hearing Wednesday and isn’t likely to advance in the 2017 Legislature. “Anything still has a chance of moving,” said Sen. Clemente Sanchez, D-Grants, chairman of the Senate Corporations and Transportation Committee, after a four-hour hearing on House Bill 412, sponsored by Rio Rancho Republican Rep. Jason Harper. But during the hearing, lawmakers were more skeptical as they heard concerns from lobbyists for doctors, hospitals, broadcasters, nonprofit organizations, schools, farmers, the dairy industry, hospice nurses and nursing homes about how the tax changes would affect their operations. Related: NM’s revenue still hasn’t recovered to pre-recession levels
Harper was not surprised. “We’ve jokingly called this bill the lobbyist full-employment act.
A proposal to raise the hourly minimum wage in New Mexico to $9 won the backing Monday of a Senate committee as well as business and labor groups. But with several bills floating around the Capitol this year to give at least a slight boost to the earnings of New Mexico’s lowest-paid workers, agreement still seems elusive on how high the state’s minimum wage should go and what strings should be attached. In a 5-3 vote, the Senate Corporations and Transportation Committee approved Senate Bill 386, which would raise the hourly minimum wage from $7.50 to $9 but allow employers to pay new hires a training wage of $8 per hour for up to two months. The bill would also raise the minimum wage for tipped employees, such as waitresses and baristas, from $2.13 to $2.63. A major public employees union, New Mexico Voices for Children and the Greater Albuquerque Chamber of Commerce have backed the proposal, seeing it as a compromise that would ensure at least some increase in pay for low-wage workers while also proving palatable to some in the business community.
Storefront lenders would be limited to charging interest rates of 175 percent under a bill that cleared a Senate committee Monday, but consumer groups called the measure inadequate. The bill sponsor, Sen. Clemente Sanchez, D-Grants, said his plan would stop interest rates of 300, 500 or even 700 percent that have led to dozens of futile attempts by legislators to regulate an industry that critics say preys on the downtrodden. “It will eliminate the high interest rate loans we have heard about for years,” Sanchez told the Senate Corporations and Transportation Committee, which unanimously advanced his proposal, Senate Bill 388. The committee, which Sanchez chairs, rejected reforms backed by a coalition of consumer advocates. Then it embraced Sanchez’s proposal, supported by many in the storefront lending industry, to cap interest rates for short term-loans and effectively ban payday loans.
If the state of New Mexico wants to get back on solid financial footing it has to take on some sacred cows, according to Sen. Ron Griggs. Griggs, a Republican who is the former mayor of Alamogordo, calls the omnibus tax bill he is sponsoring the start of that conversation. The bill not only brings back the gross receipts tax on food and medicine — albeit at a lower rate — but it raises the fee to transfer ownership of a motor vehicle and imposes a new fee to transfer or refinance real estate. Senate Bill 343 would also reduce the corporate income tax, eliminate taxes on interest income, which would benefit retirees over 55, and help cities and counties with their budget challenges. Large, complicated tax measures have not always fared well in the Legislature.
A current Santa Fe County Commissioner wants to go back to the Roundhouse. Elizabeth “Liz” Stefanics announced today that she is running as a Democrat for the seat held until March by Phil Griego, another Democrat. Griego, who had held the seat for 18 years, resigned amid an ethics issue involving his vote for a bill that benefited his real estate client. Gov. Susana Martinez subsequently appointed Republican Ted Barela to fill the seat, which he currently holds. Stefanics held the same seat for one term in the mid-1990s.
Since Phil Griego, D-San Jose, stepped down from his position as a member of the state Senate, it will be up to county commissioners throughout his sprawling former district to send recommendations for his replacement to Gov. Susana Martinez. District 39, which Griego represented until Saturday morning, contains parts of Bernalillo, Lincoln, San Miguel, Santa Fe, Torrance and Valencia counties. Each of the county commissions will choose a candidate, at which point Martinez will decide which candidate will replace Griego for the remainder of the term. The governor will likely prefer to see someone from her own party take Griego’s seat. Currently, 17 Republicans serve in the Senate.